Exadata Cloud@Customer brings Oracle's flagship database platform into your data centre with a cloud consumption model. This independent advisory covers architecture, pricing, BYOL strategies, contract negotiation, and the pitfalls CIOs must avoid.
Oracle Exadata Cloud@Customer (often abbreviated ExaCC or Exadata C@C) is Oracle's Exadata Database Cloud delivered on-premises. Oracle installs an Exadata system in your own data centre, but you consume it as a cloud service. Oracle retains ownership of the hardware and manages it remotely — just as they would in their public cloud — while you run Oracle databases behind your firewall.
It is not a product you buy outright. It is a subscription service with Oracle providing a fully managed Exadata infrastructure on a lease-like basis. For full technical details, see Oracle's official Exadata Cloud@Customer product page.
| Characteristic | What It Means |
|---|---|
| Exadata technology on-prem | Full Exadata platform — specialised database servers, smart storage, RDMA networking, flash cache — deployed at your site for mission-critical Oracle workloads |
| Cloud-managed infrastructure | Oracle handles all hardware maintenance, patching, and infrastructure administration remotely. You provision databases via OCI console or APIs |
| Data stays behind your firewall | The Exadata rack sits in your data centre. You maintain direct control over data locality, security policies, and integration with on-prem systems |
| Subscription model | Monthly base fee + pay-per-use OCPU charges. No upfront hardware purchase. 4-year infrastructure commitment typical |
In summary, Exadata Cloud@Customer is Oracle's answer for organisations that want cloud benefits — agility, subscription pricing, Oracle-managed operations — without moving their databases to an Oracle public cloud data centre. It is part of Oracle's broader Cloud@Customer portfolio, which also includes Compute Cloud@Customer and full OCI Dedicated Regions on-premises.
"Exadata Cloud@Customer is the right solution for a very specific set of requirements: you need Exadata-class performance, you cannot or will not move data off-premises, and you want Oracle to carry the operational burden. Outside of that intersection, there are often more cost-effective paths. The key is knowing when it fits and when it doesn't."
— Fredrik Filipsson, Co-Founder, Redress Compliance| Use Case | Why ExaCC Fits | Example |
|---|---|---|
| Regulatory compliance and data sovereignty | Data never leaves your data centre. Meets strict residency, privacy, and sectoral regulations | A national bank runs core customer databases on ExaCC in its own facility to comply with data residency laws while benefiting from cloud automation |
| Ultra-low latency applications | On-site Exadata eliminates WAN latency. Compute sits next to the application users | A high-frequency trading firm deploys ExaCC adjacent to its trading engines for sub-millisecond database response times |
| Database consolidation and modernisation | Consolidate dozens of legacy Oracle databases onto one high-performance platform without migrating to multi-tenant public cloud | An enterprise replaces 40 ageing Oracle servers with one ExaCC quarter rack, reducing hardware sprawl and improving performance |
| Reduced operational overhead | Oracle manages hardware, patching, firmware. DBAs focus on architecture and optimisation, not infrastructure | Autonomous Database on ExaCC automates routine DBA tasks (tuning, indexing), freeing staff for higher-value work |
| Financial flexibility (CapEx to OpEx) | No large upfront hardware purchase. Monthly subscription aligns costs with usage over time | An organisation shifts $2M in planned CapEx to a predictable $45K/month OpEx subscription |
Exadata Cloud@Customer is best utilised when an organisation needs the advantages of cloud — scalability, ease of provisioning, offloaded maintenance — but cannot relinquish control over data location or accept the latency of a remote cloud. It is a strategic solution for modernising Oracle environments under strict requirements.
Moving to Cloud@Customer doesn't eliminate licensing complexity — it transforms it. Download our guide to building governance that prevents cost overruns across on-prem and cloud Oracle estates.
Download Free →Understanding how Exadata Cloud@Customer is set up and operated is crucial for enterprise architects. The model is cloud-like for the infrastructure (Oracle manages it) and on-prem for the data and application use (you operate your databases and apps).
| Component | How It Works | Your Responsibility |
|---|---|---|
| Exadata hardware | Oracle delivers a configured rack (X8M/X9M/X10M) to your facility — database servers, storage servers, networking, and all specialised components | Provide power, cooling, physical security, and rack space |
| Cloud control plane | Secure network link from the rack to OCI. Oracle performs remote monitoring, management, and updates via this connection | Set up and maintain network connectivity (VPN or FastConnect) to Oracle Cloud |
| Infrastructure management | Oracle monitors hardware health, replaces failed components, applies firmware updates, keeps system software current | None — Oracle handles all infrastructure-level tasks |
| Database management | You create and manage databases, configure schemas, manage users, and run applications via OCI console, APIs, or CLI | Full database and application layer responsibility |
| Security (shared model) | Oracle secures the infrastructure and platform (encryption at rest, patching). You secure databases, user accounts, and integration points | Database user roles, network access policies, compliance controls |
The Exadata Cloud@Customer environment integrates with both your internal networks and Oracle's cloud. A reliable, low-latency network link to Oracle is mandatory for Oracle to manage the service. Planning this connectivity — typically via Oracle FastConnect or a VPN — is a crucial part of the deployment. Without it, Oracle cannot perform remote management, and you cannot access any hybrid cloud workflows.
Operational reality: While Oracle manages the infrastructure, the on-premises Exadata rack still requires your data centre team's coordination for physical hosting, network connectivity, and incident escalation. This is not a "set and forget" deployment — it requires close collaboration between your operations team and Oracle's support organisation.
For detailed guidance on how Oracle Cloud@Customer licensing compares to public OCI, see our Cloud@Customer vs OCI licensing comparison.
Exadata Cloud@Customer introduces a distinct cost structure compared to traditional on-premises systems. Instead of buying hardware and licences upfront, you commit to a subscription model with both fixed and variable components.
| Component | Description | Approximate Cost |
|---|---|---|
| Infrastructure base fee | Monthly charge for the Exadata rack hardware and cloud infrastructure software. Fixed for the duration of the contract | ~$8,000/month (base system) to $40,000+/month (full rack) |
| OCPU/ECPU usage | Pay-per-use for database compute resources. Billed per hour per OCPU. Minimum 8 OCPUs per database server node | ~$1.34/hr licence-included or ~$0.32/hr BYOL |
| Storage | Base amount included with the system. Additional storage and backup usage incurs charges | Varies by configuration |
| Term commitment | Typically 4-year infrastructure term. No hardware ownership — you lease the equipment | Total commitment = base fee × 48 months + projected OCPU usage |
The single largest cost lever in an ExaCC deployment is whether you Bring Your Own Licence (BYOL) or pay licence-included pricing:
| Model | OCPU Rate | 50 OCPUs Full-Time Monthly Cost | Best For |
|---|---|---|---|
| Licence-Included | ~$1.34/hr per OCPU | ~$48,200/month | New workloads where you don't own Oracle DB licences |
| BYOL | ~$0.32/hr per OCPU | ~$11,500/month | Existing Oracle DB licence holders — saves ~76% on OCPU charges |
Cost reality: The difference between BYOL and licence-included is approximately $36,700/month for 50 OCPUs — or $1.76 million over four years. If your organisation already owns Oracle Database licences, leveraging them in a BYOL model is the single most impactful cost optimisation available.
For more on BYOL strategies and how on-premises processor licences convert to cloud OCPUs, see our CIO Playbook: Oracle Cloud and BYOL Licensing Strategy.
Oracle typically sells Cloud@Customer services through its Universal Cloud Credits (UCC) model. You agree to an annual cloud spend and draw down against it as you consume OCPUs and other services. Volume discounts can be significant — committing ~$500K/year might yield ~10% off list, while $1M/year can secure ~15% or more. Very large deals have seen 30–50% discounts negotiated.
For a detailed guide to negotiating Universal Credits, see our Oracle Universal Credits Negotiation guide.
Oracle's Support Rewards programme allows you to earn credits ($0.25 for every $1 spent on OCI, or $0.33 for ULA customers) to offset on-premises support bills. A $1M annual OCI spend could reduce your database support fees by $250,000. Factor this into your total cost analysis — but don't commit to more Cloud@Customer capacity than you need just to earn rewards.
A global insurance company planned to deploy 120 OCPUs on ExaCC for core policy and claims databases. Initially quoted at licence-included rates, the 4-year compute cost was projected at $5.8M. By inventorying existing Oracle Database Enterprise Edition licences and converting them to BYOL, the compute cost dropped to $1.6M — a $4.2M saving. The company also negotiated a 15% volume discount on the base infrastructure fee.
Cloud@Customer doesn't make you audit-proof. BYOL miscalculations, options usage, and licence conversion errors are common audit triggers. Understand the risks before they find you.
Download Free →| Pitfall | What Goes Wrong | Mitigation |
|---|---|---|
| Long-term lock-in | 4-year term with no early exit. You don't own the hardware. At term end, you must renew (often with new hardware) or migrate off | Negotiate renewal price caps and exit/transition clauses upfront. Have a documented migration plan from day one |
| Overprovisioning | Oracle sales may propose a full rack when a quarter rack suffices. Larger systems carry higher base fees and higher minimum OCPU charges | Right-size based on current and near-term needs. Start with the smallest configuration and ensure the contract allows scaling up |
| Minimum usage commitments | 8 OCPU minimum per database node means you pay for baseline compute even when idle. A quarter rack (2 nodes) = 16 OCPUs minimum | Consolidate workloads onto fewer nodes. Delay billing start until databases are ready to migrate. Plan utilisation from day one |
| Overcommitment on credits | Annual Universal Credits are "use it or lose it." Overestimating usage means wasted budget. Underestimating means on-demand rates | Commit conservatively. Negotiate credit rollover, ramp-up schedules, and mid-term adjustment clauses |
| Complex contracts | Hidden charges for optional services, networking, or specific features. SLA terms may differ from expectations | Engage procurement, legal, and an independent Oracle licensing expert. Clarify every line item and support term |
| BYOL miscalculation | Incorrect licence-to-OCPU conversion, missing options, or applying wrong editions can create compliance gaps | Audit your licence inventory before deployment. Understand Oracle's BYOL conversion rules (1 processor licence = 2 OCPUs with hyper-threading) |
| Organisational readiness | Treating ExaCC like a traditional on-prem box means missing cloud benefits or creating friction with Oracle's processes | Train DBAs on OCI tooling. Update backup, recovery, and monitoring procedures. Define clear Oracle escalation paths |
"The most expensive mistake with Exadata Cloud@Customer isn't the technology — it's the contract. Enterprises that negotiate poorly end up overpaying for idle capacity, locked into terms they can't escape, and surprised by renewal pricing. The contract defines your financial and operational experience for four years or more, so invest the time to get it right."
— Fredrik Filipsson, Co-Founder, Redress ComplianceA European pharmaceutical company committed $2.4M/year in Universal Credits for ExaCC but only consumed $1.5M in Year 1 due to delayed database migrations. By engaging independent negotiation advisors, they secured a contract amendment allowing $900K in unused credits to carry over to Year 2, plus a reduced Year 2 commitment of $1.8M aligned to realistic adoption rates. Total recovered value: $1.8M over the remaining term.
| Recommendation | Detail | Impact |
|---|---|---|
| Evaluate fit for purpose | Don't assume ExaCC is right for every workload. If you don't have strict data residency or latency needs, public cloud or simpler solutions may suffice | Avoids unnecessary cost and complexity |
| Perform full TCO analysis | Compare 4–5 year cost (base fees + OCPU usage + licences + network) against alternatives: existing infrastructure, public OCI, or non-Oracle solutions | Validates the business case with real numbers |
| Optimise BYOL strategy | Inventory current Oracle Database licences. Determine which can be repurposed for BYOL. Calculate the BYOL savings vs buying new licence-included subscriptions | Can save millions over the contract term |
| Negotiate aggressively | Everything is negotiable: base fee, OCPU rates, annual commitment, discount percentages, renewal caps, SLAs, exit terms. Use leverage (competitive alternatives, upcoming renewals) | 30–50% discounts are achievable for large deals |
| Recommendation | Detail |
|---|---|
| Plan meticulously | Prepare the data centre (space, power, cooling, network). Schedule hardware delivery for minimal impact. Run a pilot migration of a non-critical database first |
| Prepare your IT team | Train DBAs on OCI interfaces. Update runbooks for backup, recovery, monitoring. Clarify who calls Oracle when issues arise |
| Define the responsibility split | Document exactly what Oracle manages vs what your team handles. Ensure no gaps in monitoring, security, or incident response |
| Recommendation | Detail |
|---|---|
| Monitor usage continuously | Track OCPU hours, storage consumption, and performance. Shut down non-production databases on weekends. Scale down at night. Use cloud elasticity to control spend |
| Review against commitment | Hold monthly or quarterly reviews of usage vs annual credit commitment. Identify underutilisation early and adjust migration plans to consume credits |
| Plan for end-of-term | Start renewal planning 12–18 months before term end. Know your options: renew with refreshed hardware, migrate to public OCI, or exit entirely |
For a step-by-step guide on negotiating Cloud@Customer contracts specifically, see our How to Negotiate Oracle Cloud@Customer guide.
Cloud@Customer BYOL deployments are a common audit target. Learn how to build a comprehensive audit-ready posture that covers both on-premises and cloud Oracle estates.
Download Free →Our independent Oracle licensing advisors can perform your TCO analysis, optimise your BYOL strategy, negotiate contract terms, and provide ongoing governance support throughout the deployment lifecycle.
Free, independent research to help you manage Oracle licensing risks and costs.
Full licence reconciliation, BYOL optimisation, and compliance assessment — ensuring your Cloud@Customer deployment is properly licensed from day one.
Learn More →Independent negotiation advisory for Cloud@Customer contracts, Universal Credits deals, renewals, and SLA terms — securing the best possible commercial outcome.
Learn More →Expert-led response to Oracle compliance reviews — protecting your organisation when BYOL calculations, options usage, or cloud deployments come under scrutiny.
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